UBS’ purchase of Credit Suisse’s US subsidiaries can move forward, the Federal Reserve said Friday.
The statement comes a month after UBS stepped in to rescue the embattled Swiss lender and prevent turmoil in the financial sector from spreading, after an emergency loan of nearly $54 billion from the Swiss National Bank failed to stop the carnage.
The problems for Credit Suisse began when the Saudi National Bank, its largest backer, said it wouldn’t put up more cash after buying a nearly 10% stake in the bank for $1.5 billion in 2022.
Banking customers were already on edge after the collapses of Silicon Valley Bank and Signature Bank — so Credit Suisse shares tumbled more than 25% and saw billions of dollars of outflows.
The global turmoil has led US lawmakers to call for tighter regulations on banks. The Fed board said UBS will provide a quarterly updated plan for combining UBS’s and Credit Suisse’s US business and operations.
“The implementation plan will address UBS’s obligations to comply with more stringent enhanced prudential standards, including liquidity standards,” the Fed said in a statement.
UBS is shelling out 3 billion Swiss francs, or $3.25 billion, for Credit Suisse.
This article was originally published by CNN.